Importance of CSR activity to stakeholders

An organization does not exist in isolation. It relies on multiple interdependent

relationships with customers, employees, suppliers, communities, and investors, in other

words, the organization’s stakeholders. By engaging with stakeholders, organizations can

ensure their materiality assessment is robust and inclusive within the part of the CSR

reporting process. The stakeholders decided to engage with will vary depending on the

structure of your between. Interestingly, there has been a noticeable shift in the stakeholders

that companies identify as having the greatest impact on CSR business decisions, moving

away from NGOs to wider society, consumers, and employees. Consistent CSR engaging

with stakeholders enables a company to design a program that helps to identify appropriate

standards and approaches to CSR management, recognizing that some stakeholders are

extremely knowledgeable and may even be involved in the development of these standards

and codes. This is extremely valuable when evaluating the options available for CSR

reporting. (Singh A, 2017).

Corporate Social Responsibility (CSR) practices are important for companies like Top

Glove for a number of reasons. Firstly, CSR activities can help to build a positive reputation

for the company, enhance its brand image, and create goodwill among stakeholders. This

can be beneficial in terms of attracting customers, investors, and employees who are

increasingly looking for companies that are socially responsible and sustainable. Good

reputation will reshape the orientation of multinational corporations to their stakeholders. By

positioning themselves as stakeholders in a broader global community, conscientious

corporations can be exemplary organizations. They can demonstrate interest and influence

on a global scale and improve the way the manufacture of goods and delivery of services

serve the local and global environment. They can return to communities as much as they

extract and foster automatic financial reinvestment so that people willing and able to work for

them can afford not only the necessities but a chance to pursue happiness. In return, global

corporations will have sustainable business models that look beyond short-term growth
forecasts. They will have a method of operating and a framework for thinking about

sustained growth with stakeholders and as stakeholders. Ethical stakeholder relationships

systematically grow wealth and opportunity in dynamic fashion. Without them, the global

consumer economy may fail. On an alternate and ethical path of prosperity, today’s supplier

is a consumer in the next generation and Earth is still inhabitable after many generations of

dynamic change and continued global growth (Journal of the Academy of Marketing

Science,2006).

Secondly, CSR activities can help to mitigate potential risks and negative impacts

associated with the company's operations. For example, Top Glove's operations may have

environmental impacts such as air and water pollution, waste generation, and energy use.

Through environmental conservation campaigns and sustainability initiatives, the company

can demonstrate its commitment to reducing its environmental impact and contributing to a

cleaner and healthier environment. The effort of the company can be clearly observed as

Top Glove has been named Company of Year Overall Excellence in Sustainability and CSR

under the Manufacturing category at Sustainability & CSR Malaysia Awards 2022. Several

factors contribute to the selection of the winners of the Awards, including whether the

company’s practices align with the Sustainable Development Goals (SDGs); how often

sustainability and corporate social responsibility initiatives are held; the impact these events

have created in the community; the total contribution made; the transparency of reporting

sustainability and corporate social responsibility activities; the strength of the team; and the

effectiveness of each initiative (Top Glove, 19th Aug 2022).

Thirdly, CSR activities can have a positive impact on the communities in which the

company operates. By supporting community initiatives and providing assistance to

underprivileged groups, Top Glove can contribute to the development and well-being of

these communities. This can help to build trust and long-term relationships with

stakeholders, including customers, suppliers, and local authorities. Apart this, Top Glove

Foundation was established in June 2009 with the aim of raising funds for the purpose of

charity, education, and activities related to the environment and community. Under the
umbrella of the Foundation, the glove manufacturer promotes sustainability and corporate

social responsibility projects under three key philanthropic pillars: Community, Education,

and the Environment. The Foundation had initiated several programs under these pillars to

support individuals and communities during the different iterations of Movement Control

Order (MCO), which were in place for extended periods throughout the pandemic. As at

FY2022, Top Glove Foundation has Pledged approximately RM31.5 million in support of

1,500 charitable organisations and NGOs, accomplished approximately 22,000 volunteering

hours with the participation of 3,000 employees in various CSR activities and Awarded a

total of 130 scholarships for students to pursue their tertiary education (Top Glove Annual

Report, Y2022).

Next, CSR activities can improve employee engagement and job satisfaction.

Employees who feel that their company is committed to social responsibility and making a

positive impact on society are more likely to feel engaged and motivated in their work. This

can lead to increased productivity, job satisfaction, and employee retention. CSR also helps

to attract and develop talent of employees. It can be a struggle to attract and retain talent.

Still, research has shown that 82% of Gen Z workers consider CSR a significant factor when

deciding on their next employer, and 66% would consider a pay cut if it meant working for a

more socially responsible company. It’s a similar story for millennials, with 82% considering

CSR efforts when deciding where to work, and 70% willing to take a 30% pay cut to work for

a company with strong social values. However, it doesn’t stop at the younger generations.

LinkedIn found that 75% of candidates research a company’s online reputation before

applying for a role. Research shows that companies with CSR programs where their people

are actively engaged in giving and volunteering saw a 57% reduction in turnover for those

employees (Bevenity, 2020)

CSR activities can also enhance customer loyalty. Customers are increasingly

looking for companies that are socially responsible and sustainable, and are more likely to

be loyal to companies that demonstrate these values. By engaging in CSR activities, a

company can attract and retain customers who share its values and commitment to social

responsibility.

Reference:

Singh A, Majumdar S, Saini GK. Corporate social responsibility and social entrepreneurship:
An Indian context. Journal of Entrepreneurship and Innovation in Emerging Economies.
2017;3(1):71-76.

Sen, S., Bhattacharya, C. B., and Korschun, D. 2006. “The Role of Corporate Social
Responsibility in Strengthening Multiple Stakeholder Relationships: A Field experiment.”
Journal of the Academy of Marketing Science.

Alrubaiee, L., & Al-Nazer, N. (2010). Investigate the impact of relationship marketing
orientation on customer loyalty: The customer's perspective. International Journal of
Marketing Studies

https://www.topglove.com/single-news-en?id=840&title=sustainability-and-csr-malaysia-
awards-2022-top-glove-wins-top-honours

https://www.topglove.com/annual-report /Y2022

https://benevity.com/resources/corporate-social-responsibility-benchmark